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    Market Efficiency – Sub-Hourly Settlement

    The AESO has launched its engagement to examine the merits of moving to sub-hourly settlement for the energy market. During previous stakeholder consultations, it was identified that to manage the evolving generation mix, more flexibility in the fleet may be required. This led to further exploration of the issue which identified that sub-hourly settlements had the potential to incentivize flexibility and improve price fidelity for the Alberta market. 

    Efficient operation of the market relies upon access to accurate prices that reflect the marginal costs of generating and benefits of using electricity. The more closely prices reflect the physical condition of the market, the more efficient the price signals. The mismatch between dispatch and consumption and settlement intervals may result in a poor quality price signal, and potentially incentivizes adverse dispatch response.

    The AESO’s engagement on sub-hourly settlement will explore the following topics:

    • Considerations with integrating sub-hourly settlement intervals in Alberta;
    • The extent to which sub-hourly settlement versus hourly settlement incents flexibility and improves price fidelity; and
    • The benefits and costs of moving to a shorter interval, and determine key implementation considerations.

    The AESO anticipates hosting three to four engagement sessions from February to September 2020 to examine this topic and for stakeholders to provide advice to the AESO in forming a recommendation. The sessions were held on Feb. 25, April 23, and Sept. 23, 2020. 

    Based on stakeholder feedback received in the second session, the AESO has posted the data files for Pool Price at 5 and 15 minute intervals in the materials section below.

    We have investigated and tested potential collaborative video conferencing tools and will be using Zoom for the engagement sessions.

    Materials

    If you have any questions, please contact stakeholder.relations@aeso.ca and subscribe to our stakeholder newsletter for updates.

    To view the 2020 Plan for Market-Related Initiatives Schedule, click here.